Foreign Trade, currency and banking, tourism in Vietnam

Photographic book - Vietnam - 1/03/19

Vietnam Trade

Tourism in Vietnam

During the French colonial period, Vietnamese foreign trade was characterized almost exclusively by the export of primary raw materials—such as rice, rubber, and other tropical products—and the import of manufactured goods from abroad, mainly from France. During the Vietnam War, both the North and South had a chronic imbalance in their balance of payments, as their sponsors pumped in military and economic assistance with little regard to their client’s ability to pay.

After reunification, these adverse conditions continued. Vietnam consistently ran a significant deficit in its trade relations with foreign countries. At first, the bulk of Vietnamese trade was with the Soviet Union and other Communist countries, which exported manufactured goods, food, and oil to Vietnam in return for cheap textile goods, cash crops, and maritime products. Trade was tightly controlled under the management of several state-owned trading corporations, each specializing in a particular commodity line. The United States imposed a trade embargo on North Vietnam in 1964 and all of Vietnam in 1976; this embargo was lifted in 1994.

Foreign trade has developed rapidly since the implementation of the doi moi reforms and the end of the U.S. embargo. Most foreign trade now takes place with other countries of Asia or with developed countries in the West. Exports have increased significantly, notably in the area of cash crops, oil, and rice. But imports of foreign technology and consumer goods have increased as well, and the trade deficit continues to be one of the country’s most serious problems. In 2007 the value of imports was estimated at $60.8 billion, while exports were estimated at $48.4 billion.

Vietnam’s national monetary unit

Vietnam’s national monetary unit is the new dông, which is divided into 100 xu (16,105 new dôngequal U.S.$1; 2007 average).

Until 1990 the only banking system within the country was The State Bank of Vietnam, with its headquarters in Hanoi. In 1990 the government established four independent commercial banks (for foreign trade, investment and construction, agricultural development, and industry and commerce) and allowed foreign banks to operate. The State Bank continues to perform general supervisory functions; it also controls the money supply and credit policies. The Bank of Foreign Trade is authorized to handle foreign currencies.